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Retailers Can Use Digital Tech to Thrive in a ‘Phygital’ World

Indian retailers are aggressively investing in CX, Cloud, IoT, etc, to drive efficiencies and experiences in a phygital world.


The retail landscape today is changing rapidly with the rise of e-commerce, mobile shopping, and smart technologies. The global pandemic further forced retailers into a shift in how they operate. While online commerce will continue to dominate the retail lansdscape, customers also want to have a high personalized experience when they are taking a trip to the mall and buying in-store – making both online and offline experiences unique. To effectively meet the ever-changing consumers’ demand in an increasingly ‘phygital’ world, retailers must use new-age digital solutions.

A recent report by Airtel Business, titled ‘The Future Of Retail In India Is Both In The Store And Online’, outlines that winning brands of the future will be the ones that embrace digital technologies ahead of the curve to deliver an omnichannel experience to their customers. And that ‘Phygital’ is the new normal in Retail with customer experience increasingly driven by immersive technologies built on Cloud and IoT in the 5G era. 

 “Technology is driving new avenues of growth in Retail,” affirms Sanchit Vir Gogia, Chief Analyst & CEO, Greyhound Research. He believes that the pandemic has ushered in a wave of transformation in the retail sector. Over the past 18 months, technology has been used to deliver contactless experiences, and retailers are now looking for newer ways to stitch offline and online channels. The era of omnichannel and phygital has truly arrived. As retailers adopt a technology-first mindset, the sector is well poised to become the sunrise sector of India, all over again.”

The report draws four key themes that will help re-shape the retail segment: 

Delivering Value and Experience: While value has always been a factor in consumer behaviour, the perception of value has changed with time. Therefore, the need of the hour for retailers is to deliver immersive and personalized experiences for price-savvy customers on the hunt for value. Also, retailers must account for the changing demographics and aspirations of a young India that spends considerable time hunting for deals yet expecting the best customer service each time. 

 Borderless Commerce: Retailers must build Digital avatars to tap future growth opportunities and serve customers with an omnichannel experience without the challenge of location.

Suparna Mitra, CEO, Watches and Wearables Division, Titan Company for example believes that video shopping is very important at Tanishq as consumers want to see people wearing the ornaments real-time before they purchase and thus the demo is crucial.

“However, Titan hasn’t stopped there and is leveraging technology to enable stores for an authentic omnichannel experience. Interestingly, while in March 2020, less than 20% of their exclusive stores were omnichannel enabled, as of date, it stands at 100%,” Mitra says.

Immersive shopping experiences using Augmented Reality and Virtual Reality will help make the sale just like a physical store with last-mile experience-driven cloud-based applications on edge data centres. This concept is connected closely with Social Commerce that is being leveraged for Direct-To-Consumer (DTC) efforts.

 Rise of Automation: As retailers invest in information and operational technology, they can now capture more customer data. The next step in this evolution is to utilize this data for much smarter (read automated) decisions to serve customers. For this, the retailers will need deep data science capabilities and enable video chatbots and real-time delivery by drones. 5G ready IoT will further accelerate this journey. As per Greyhound Research’s Retail Priorities 2021 survey, till March 2021, over 50% of large Indian retailers have either already started piloting IoT or planning for it in the next 12-24 months. 

Mass personalization: To make border-less commerce work, retailers must ensure personalized experiences and not just personalized communication. Retailers must develop deep capabilities to measure interactions and the entire customer journey irrespective of the touchpoint it originates from.

Arvind Mediratta, MD & CEO, Metro Cash and Carry, underscored Suparna Mitra’s beliefs and stated, “The future will be omnichannel – the best of both physical and digital worlds. However, even with the advantages of online shopping, physical stores will continue to have a future because customers demand the ability to touch and feel products as the shopping experience is a celebration to be cherished with rich interaction.”

The report adds 5G will speed up the digital transformation of the retail sector from the supply chain to the in-store experience. This will be achieved by delivering crucial technology building blocks to enable frictionless, end-to-end consumer experiences in the form of enhanced broadband networks and ultra-reliable, low-latency communications. Retailers are working to differentiate themselves with more personalized and convenient experiences and services, and thus there is the need for faster, more reliable, and device-inclusive connectivity. 

Digital technologies are shifting the new normal faster than ever. The trend is even more pronounced in the post-Covid world. Brands that embrace digital faster will be the winners. At Airtel Business, we are committed to supporting the digital transformation of our customers. We are thankful to our Customer Advisory Board for making this journey a collaborative one,” Ganesh Lakshminarayanan, CEO- Enterprise Business, Airtel Business, says.

Maximizing both online and offline customer experience has become one of the top priorities of retail CIOs today. A recent Harvard Business Review article noted that “while e-commerce will continue to be an essential element of retail strategy, the future success of retailers will ultimately depend on creating a cohesive customer experience, both online and in stores.” While ecommerce sales will continue to grow, an Euromonitor research indicates that 78 percent of all purchases will still be made in-store by 2024.

A Google research further shows the pandemic has made people more flexible  about whether they buy online or offline” with 73 percent of people in their study saying they are channel-agnostic, compared with 65 percent pre-pandemic.

In such a scenario, investing in the technologies that will allow retailers to manage or even exceed their customers’ expectations will be the key to a successful merging of the physical and digital environments.

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